Approximately 36,000 individuals capitalize on housing tax exemptions.
First-Time Home Buyers in Portugal Benefit from Exemption Measure
Good news is brewing for young homebuyers in Portugal! A recent revelation by the Ministry of Finance shows that the tax exemption for young people acquiring their first permanent residence has already assisted 36,378 individuals since its inception. As we delve deeper into this matter, let's explore the intricacies of this exemption and its impact on the property market.
The ministry, under the leadership of Joaquim Miranda Sarmento, also shared that by the end of April, 25,275 properties had been acquired under this scheme, with an average value of €190,900 per property. Compared to the data released in March, this marks an increase in both the number of beneficiaries and the houses acquired, with the average value of the houses sold remaining nearly stable at around €190,900.
This measure, introduced last year, caters to young people aged 35 and under. It offers a full exemption for properties valued up to €316,772, and a partial exemption for properties up to €633,453, with an 8% transfer tax rate applied on the excess value. To be eligible, these young buyers must not have been considered dependents for income tax purposes in the year they bought the house.
According to the latest data from the Bank of Portugal, this welfare-oriented mechanism accounted for 9% of new mortgage contracts in just the first quarter following its launch. The data also indicates that banking institutions participating in the protocol for public guarantees for young people's first homes have already utilized 10% of the maximum amount available during the first three months of the year. However, the use of the guarantee has varied between institutions, with some using more than 30% of their allocated limit, while others haven't gone above 5%.
Geographically, metropolitan areas have been leading the charge when it comes to using this support. Municipalities like Sintra, Vila Nova de Gaia, and Seixal have emerged as the most sought-after locations. Interestingly, the average value of contracts backed by collateral is higher than the value of contracts for eligible borrowers who did not opt for the guarantee. This suggests that the guarantee may have played a role in securing more affordable properties for young buyers.
As we diversify our living arrangements and strive for greater financial independence, this tax exemption breathes fresh air into the property market. The escalating numbers signify a positive impact, yet it remains to be seen how this measure will influence the long-term availability and prices of housing in Portugal. Happy home-seeking to all the young buyers out there! 🏡🌟🇵🇹
- The tax exemption measure in Portugal, designed for first-time home buyers aged 35 and under, has contributed significantly to the finance sector, accounting for 9% of new mortgage contracts in the first quarter following its launch.
- The real-estate market in Portugal has been influenced by this exemption, with metropolitan areas like Sintra, Vila Nova de Gaia, and Seixal emerging as the most popular locations for young buyers taking advantage of this financial opportunity.
- The Ministry of Finance revealed that by the end of April, 25,275 properties were acquired under this scheme, with an average value of €190,900 per property, indicating an increase in both the number of beneficiaries and houses acquired since its introduction.
- The tax exemption measure in Portugal, covering values up to €633,453, has stimulated the housing market, particularly for personal finance and investing in properties, which might impact the long-term availability and prices of housing in Portugal.
